Higher import duty could cut Indian gold demand by approximately 2.4% this year : WGC

0
24

MUMBAI: The increase in gold import duty to 12.5 per cent from 10 per cent by India from July 5 could cause consumer demand for the metal to reduce by approximately 2.4 per cent in 2019, miner’s lobby World Gold Council forecasts in its Gold Mid-Year Outlook 2019. WGC added that if the higher duty becomes permanent, long term consumer demand would reduce by “slightly,” less than 1 per cent a year.
Consumer demand for gold in China was 994.3 tonnes against India’s demand of 760.4 tonnes in 2018. In the quarter through March 2019 demand in China stood at 255.3 tonnes against 159 tonnes for India .
However, WGC expects that broad structural economic reforms being implemented in both India and China “will likely support long-term gold demand. In addition, we expect central bank gold demand — led by emerging markets — to remain positive for the foreseeable future,” added the council.
The gold body cited that financial market uncertainty and accommodative monetary policy by central banks like the US Fed would support gold investment demand over the next six to 12 months .
It also observed that returns on gold in the year the rough June 30, 2019 at 10.2 per cent were higher than those of US treasuries (5.2 per cent), global treasuries (5 per cent) and emerging market stocks (9.2 per cent).
Gold price currently stands at $1418 an ounce against average price of $1268.5 last year . In rupee terms the price , including duty is currently at Rs 34930 per 10 gms.

LEAVE A REPLY

Please enter your comment!
Please enter your name here